Will the ringgit move below RM3 to $1? Very likely. That possibility has risen following a break below the RM3.20 support by the SGD on the daily and weekly charts. The RM3.20 support level was breached in November last year. The chart pattern indicates a downside objective of below RM2.90. That means that shopping in Johor will be less meaningful over time.
Both the daily and weekly indicators suggest that the ringgit will continue to strengthen before any meaningful rebound by the SGD. For instance, although 21-day RSI is at 23, and 13-week RSI is at 13, which are oversold levels, the rebound is only likely after a positive divergence develops and this is likely to take several weeks to establish.
Hence, the ringgit is headed towards RM3 initially, where it could meet with some support. However, both weekly and daily indicators show that down-momentum is strong, pointing to the ringgit heading towards RM2.90 against the SGD.
See also: STI's correction is not likely to breach the main uptrend
On the fundamental front, Bloomberg reports that Malaysian exports in January jumped by 19.6% y-o-y, well above expectations. In addition, Malaysia’s GDP growth in 4Q2025 rose by 6.3% y-o-y, above expectations of 5.7%. GDP growth in 2025 was 5.2%, above the government’s target range of 4% to 4.8% growth. The Malaysian economy is likely to expand by 4.5% in 2026, according to a median estimate in a Bloomberg News survey. Bank Negara Malaysia publishes its annual report in late March.
Meanwhile, foreign direct investment into data centres has been significant. In August last year, InvestJohor had indicated that Johor had approved 42 data centre projects worth RM164.45 billion which could partly account for ringgit strength.
The Straits Times Index rose 80 points week-on-week to end the first week of the Year of the Horse at 5,017. The STI’s indicators suggest sedate moves rather than a gallop. A break above the high of 5,021 on Feb 12 will enable a swing to 5,122. Support is at the rising 50-day moving average at 4,785.
